GK Question- 40

First Published: May 13, 2012 | Last Updated:January 11, 2013

The Constitution of India provides that Trade, Commerce and Intercourse throughout the territory of Union of India is free. However, despite this provision, a state in India can make law for imposing taxes on imports of goods from other states in India, provided the goods produced in other states are also taxes in that state in the same manner. Who decides whether the states can make such law or not?
[A]The State which is imposing law itself
[B]The States which have interests in the taxes to be imposed
[C]Parliament of India
[D]President of India

Explanation: Constitution of India says that Trade, Commerce and Intercourse throughout the territory of Union of India is free, but this is subject to some other provisions of the same part. Article 301 says that parliament may impose restriction in some parts of the territory in the interest of general public. For example a famine struck state may lead the parliament to enact some discriminatory law also, if that discrimination is in favor of the public interests. The states, as per article 303 of the constitution are allowed to impose taxes on goods imported from the other states provided they goods produced in other states are also taxes in that state in the same manner. But who will decide, whether the states can enact such law or not? This is to be decided by the President. Thus, if we consider that Rajasthan wants to impose a tax on a good that is imported from Gujarat, the bill of such kind has necessarily get a sanction from President. President may hold his/ her sanction after looking in details that the said bill is in the public interest.